11/10/2003 @ 12:00AM

Inside Dope

In the quiet countryside just outside Vancouver, B.C. an ambitious young entrepreneur surveys a blindingly bright room filled with lovely plants–dozens of stalks of high-power marijuana. Almost ready for harvest, they hold threadlike, resin-frosted pot flowers, rust-and-white “buds” thickening in a base of green-and-purple leaves. The room reeks of citrus and menthol, a drug-rich musk lingering on fingertips and clothes.

“There’s no way I won’t make a million dollars,” says the entrepreneur, David (one-name sources throughout this story are pseudonymous). He runs several other sites like this one, reaping upwards of $80,000 in a ten-week cycle. Says he: “Even if they bust me for one, I’m covered.”

So, it seems, is much of Canada–covered with thousands of small, high-tech marijuana “grows,” as the indoor farms are known. Small-time marijuana growing is already a big business in Canada. It is likely to get bigger, despite all the efforts of the antidrug crowd in Washington, D.C. On Oct. 14 the U.S. Supreme Court, by refusing to disturb an appeals court ruling, gave its stamp of approval to doctors who want to recommend weed to ease their patients’ pain or nausea. In the U.S. nine states have enacted laws permitting marijuana use by people with cancer, AIDS and other wasting diseases. The Canadians are even more cannabis-tolerant; although they have not legalized the drug, they are loath to stomp out the growers. This illicit industry has emerged as Canada’s most valuable agricultural product–bigger than wheat, cattle or timber.

Canadian dope, boosted by custom nutrients, high-intensity metal halide lights and 20 years of breeding, is five times as potent as what America smoked in the 1970s. With prices reaching $2,700 a pound wholesale, the trade takes in somewhere between $4 billion (in U.S. dollars) nationwide and $7 billion just in the province of British Columbia, depending on which side of the law you believe.

In the U.S. the never-ending war on drugs endures, to modest discernible effect. In a largely symbolic act the U.S. Justice Department has just imprisoned an icon of the pot-happy 1970s–Tommy Chong of the old Cheech & Chong comedy team–for selling bongs on the Internet (see box, p. 154). But in Canada the trade in pot, or cannabis (as many Canadians call it), is an almost welcome offset at a time when British Columbia’s economy is in the doldrums.

Tourism here is down, and thousands of jobs got axed when the U.S. slapped tariffs on exports of softwood and then banned Canadian beef after an outbreak of mad cow disease. The marijuana business, by contrast, is thriving, not least because Canada shares a thinly guarded 5,000-mile border with the U.S., a big market. Ultimately much of the revenue flows into the coffers of hundreds of legitimate businesses selling supplies, electricity and everything else to the growers and smugglers.

And who are these growers? Not a small coterie of drug lords who could be decimated with a few well-targeted prosecutions, but an army of ordinary folks. “I know at least a hundred [of them], 20 years old to 70,” says Robert Smith, who isn’t part of the trade but indirectly profits from it at the furniture store he owns in Grand Forks, B.C., 110 miles north of Spokane, Wash. “Of the money coming through my door, 15% to 20% comes from cannabis–we’d be on welfare without it.”

Mexico remains the biggest supplier of foreign pot for U.S. consumers, growing valleys of lower-grade grass and sending it north; some 500 tons of pot were seized at the Mexican border in 2001, more than 100 times the volume confiscated at the Canadian boundary. California is a prodigious supplier, as well. But Canada’s industry is notable for its dispersion. The scattered and all but undetectable production may well herald a modus operandi for other regions.

Small growers like David bring in $900 a pound at the low end, with net margins of 55% to 90%, depending on quality, depreciation and labor costs. They produce half a pound to 30 pounds every ten weeks, selling their product to local users or peddling it to “accumulators,” who then smuggle it over the border or sell it up the chain to larger brokers. Accumulators and brokers typically add $80 a pound to the cost, as do the high-volume smugglers who buy from them. Smugglers returning money to Canada for other dealers skim a 2% laundering fee.

“The first time somebody gives you a bag of money so heavy that you can’t lift it, it’s surreal. Pretty soon, it’s just dirty paper,” says Jeff, who recently retired from smuggling up to a ton of weed a week.

Building The Perfect Bud

Want dope? Plant seeds. Want high-end dope? Pay attention.

LIGHTS: With 1,000-watt metal halide lights first blasting clones for 24 hours a day, followed by 12-hour intervals of dark to force budding, a half-year grow cycle is cut to ten weeks.

GENETICS: Breeding stock is critical to top-quality pot. Branches of the best female plants are cut and potted. The genetically identical offspring are also cloned.

DIRT: Or hydroponics or aeroponics. Nitrogen for growth, phosphorous and potassium for resinous flowers. Beneficial fungi and bacteria to boost THC.

Sources: Ed Rosenthal; Advanced Nutrients.

Jeff started out a few years ago by growing just 8 pounds of pot with his friends. Within a year they were brokering hundreds of pounds from other small growers to someone with connections to large U.S. distributors. When that person’s buyer retired, Jeff paid him $250,000 for the buyer’s client list. “Sounds astronomical,” he says, “but at the time it looked free.”

Once in the U.S. the bud usually stays on the West Coast. In Seattle a pound of top-quality pot sells for $4,000, and by the time it hits Los Angeles it runs up to $6,000. High-grade cannabis then sells at smaller weights, eventually burning up at $600 to $800 an ounce.

Back in British Columbia the business of pot encompasses wholesaling different strains of seeds for 95 cents to $1.90 apiece, the prices depending, among other things, on how well a strain’s buds rank at annual (and very public) “breeders’ cup” competitions in Amsterdam and Vancouver. Plants can also be propagated from cuttings, sold for $3 to $10 each, wholesale.

This is a job-creating industry. Trimming the dried flowers to maximize look and taste of the top product pays about $15 an hour for a skilled laborer; it takes ten hours for an experienced trimmer to turn out a pound of buds. Consultants get $40 an hour for helping junior growers.

Marijuana underwrites other businesses, too. Vancouver tour guides brag of quality “B.C. bud,” and “smokeasies” near the Canadian border cater to Canadian and U.S. customers. Local authorities wink at the offense. The owners of these smokeshops resemble camp followers of a particularly tough Grateful Dead tour. Customers include clean-cut men in golf shirts, grannies and women cradling babies.

Advice magazines offer tips on growing; lighting shops are spread across the country to serve novice farmers; and fertilizer companies target their marketing to pot growers (see box). In the wake of a federal crackdown on makers of marijuana pipes in the U.S., those businesses are relocating north of the border.

In the Kootenay mountains of B.C., Gary Bergvall sold lights from a 15-by-15-foot space in 1996. Now he employs 28 people and runs a factory that ships, each week, lighting systems as well as two tractor-trailers full of air filters. Could the activated charcoal filters be useful for absorbing the telltale odor of certain plants? Maybe. The lights? Bergvall is circumspect. They are used “for a special purpose, whatever that may be,” he says.

Marc Emery started a mail-order marijuana-seed business in Vancouver in 1994, moving 100,000 seeds a year at an average $3.75 each. Today the tax-paying entrepreneur sells 350,000 seeds a year, even though he has more than 20 Canadian competitors (plus rivals in Holland, Spain and the U.K.). Selling seeds in Canada is illegal, but just about no one is busted for it.

Web sites from Vancouver to Montreal sell pot to medical patients in Canada; one site requires only a doctor’s letter testifying you have one of 192 afflictions (including writer’s cramp and hiccups). Barbara St. Jean, a financial planner, got a pot prescription to treat pain associated with lupus. She and her husband, Brian Taylor, a former mayor of Grand Forks who later ran for national office on the Canadian Marijuana Party ticket, have taught college courses on how to grow cannabis indoors. St. Jean once gave a speech to some 40 city planners from across B.C., extolling the potential benefits of cannabis to their local economies.

All of this action owes much to the U.S. and an inflow of draft-dodging pot smokers during the Vietnam War. The marijuana growers among them introduced sinsemilla (Spanish for “without seeds”), the unpollinated female plant, which is far more potent than its male counterpart. In the 1980s refugees from a northern California war on pot also headed to B.C., just as 1,000-watt lights made possible year-round production of top-grade strains. Locals learned to grow for their climate.

The market is now mature enough for precise segmentation. Dealers grade buds like bonds, starting at BB, worth just $800 a pound because of its chemical taste and black ash when burnt. A-quality cannabis tends to be well-grown outdoor product, at $1,300 because of its somewhat loose buds. AAA, the type David grows and Jeff smuggled, is characterized by tight clusters of flowers, a pleasant smell of eucalyptus and enough drug-rich resin to coat the sides of a plastic bag. Even on a carefully grown plant only 50% of the buds are the right size and shape for AAA. The best stuff has odd varietal names–Mango and Blueberry for the fruity-smelling strains, and F—ing Incredible and Romulan (a nod to the warriors with dented heads on Star Trek), a testimony to the euphoric, incapacitating effects.

Producing the seeds of such strains is up to guys like Daniel, a third-year apprentice breeder along western B.C.’s coast. He helps produce about 60 varieties, starting with a dark green bud called “Mighty Mite,” a plant for urban window boxes that grows to the size and shape of a corn dog. At the other end are 14-foot-high monsters that reflect their origins in the Brazilian jungle.

Daniel’s newest creation is a straight-stemmed plant that stands 8 feet high and has thick, well-spaced clumps of flowers. “This is a good prairie strain,” says the Alberta native. “You could harvest it with a combine or a sunflower cutter. I’d like to produce seeds in 50-pound bags.” Like many people in the Canadian cannabis trade, he expects marijuana cultivation will be fully legal before long.

For Daniel, thieves, not the the police, are the big worry. And with good reason: The Royal Canadian Mounted Police, which opposes many of Canada’s pro-pot steps, concedes that in B.C. only one-fifth of marijuana busts result in incarceration and the average sentence is only four months. “Maybe the police can take these plants,” Daniel says, nodding to a packed greenhouse. “Maybe they’ll even take me downtown, maybe arrest me. Maybe. But we have clones and copies of every one of our plants in three more locations.”

With seeds or clones an indoor grower can spend just $1,600 to set up a 9-square-foot indoor plot capable of hosting 72 small plants that produce 31/2 pounds of mixed-quality buds in seven weeks. A well-wired operation with 20 lights costs $20,000 to set up. Most growers stop at 10 lights lest they attract attention with a steep electricity bill.

A good rule of thumb in figuring yield is 1 to 11/2 pounds of bud per light. By using cuttings and closely regulating how much light the plants get, indoor gardeners crush a normal five-month growing cycle into ten weeks. Like high-end winemakers, these producers obsess about methods, singing the virtues of organic gardening, hydroponics (soilless agriculture), even aeroponics (with nutrient misted on the plants). Some pot farmers pump carbon dioxide into the room. Growing AAA is labor intensive: The plants need daily watering, spraying and cutting back, producing a trash bag full of unwanted leaves each week for a small grow.

David, the western B.C. grower who dreams of making a million, has hired caretakers to oversee three additional rooms of 20 lights each; the employees include a retired mining executive and a middle-aged American fugitive, he says. They get 25% of the crop, and David splits the rest with his financier, a retired grower/smuggler. His landlords get an extra $1,500 a month on top of the rent, and he pays for repairs from any water or soil damage when production ceases. He lives in a neat house on a quiet cul-de-sac, rigged with radio-controlled motion detectors. Full of kids, dogs and golf clubs, it is prosperous and unremarkable, except for details like the beat-up cracker box brimming with the household pot stash and the note on the fridge that reads: “Gretchen called: Probation!” It seems almost like a game, until Anne, his wife, voices the underlying stress.

“When someone goes down, we all feel really bad, but you can’t get too close to someone who’s involved with the law,” she says as she prepares the kids’ breakfast. “You try to keep them away from it as much as possible.” A helicopter cuts through the morning fog, and she tenses momentarily. “You do a lot of yoga; you try to pretend it isn’t real.”

Prepared product is packed in half-pound lots. Forty bags fit into a typical carry-on suitcase. Small-scale marijuana smugglers, or “rabbits,” run dope to the U.S in car rides, marathon jogs, three-hour kayak trips or floating hollowed-out logs on the tide. The Mounties, with a patrol fleet of just four boats, are not a big worry on the water.

“You can get 80 pounds into a backpack, and you get big legs running over the mountain,” says Paul de Felice, co-owner of the Holy Smoke smokeasy in the eastern B.C. town of Nelson. “I’ve seen them so nervous they vomit before they take off–but I never see them stop.”

As in all business, it is important to manage risk. Jeff would first try a smuggling method with 50 pounds; if it worked, he would try 100, then 300. He moved pot in the fiberglass hulls of yachts and in the false floors of long horse trailers. “No border agent wants to unload all those horses, shovel out that manure,” he says.

One method: Drag a shipment underwater behind a fishing boat. A zinc strip fastens a buoy and a length of line to the package. If the boat is stopped, the crew cuts loose the shipment, which sinks, buoy and all. The zinc dissolves in the seawater within 12 to 18 hours, and the buoy surfaces with its line tied to the pot, letting Jeff recover the dope. Another method involves bisecting a propane truck, inserting 500 pounds of bud below a false floor and setting the gas pressure in the truck to read as if it were full.

Eventually “you use a lot of planes,” he says. “They’re faster, they give you more control and you get better prices if you can deliver 40 miles over the border, past the hot zone.” Pilots fly low, hugging mountains on the lee side of fire towers.

Jeff has retired in the face of exhaustion, a fear of snitches in the network and rumors that the U.S. government has planted an agent in the system, who over time is rising high enough to decapitate a big smuggling operation. When asked how many people in the big operations really leave, however, he says, “Maybe 5%. I’ve got pilots I made millionaires, and they still fly.” Jeff’s fear of a mole may be well grounded, for the Mounties hope to strike a blow to Canada’s cannabis business with a string of big, high-profile busts over the next several years. But the pot business, with a structure less like typical crime rings and closer to that of the Internet–lots of little nodes (in this case, producers) feeding a loosely organized hierarchy–will be difficult to shut down.

The Mounties are not happy about legal marijuana for medical patients–they say the drug needs more study before it is dispensed–but they worry more about the effect of the marijuana-rich gangs on the Canadian economy. It is not just the possible violence (U.S. guns have been traded for Canadian pot), but the business considerations. “There are many millions of dollars here, wrecking the legitimate business,” says Rafik Souccar, director general of drugs and organized crime enforcement for the Mounties. The contraband dealers launder money through unprofitable concerns, which then charge artificially low prices for legit goods.

Police also worry about the hazards of poor electrical wiring, hazardous molds and excessive chemical use at grow houses–and a public too blasé about the dangers of drug use. “Part of the problem is a laissez-faire attitude on the part of the public,” says Charlie Doucette, a Mountie in charge of drug enforcement in Vancouver. “We don’t have an appetite in Canada to say ‘This isn’t right.’”

Some police think the battle may well be over. Rollie Woods, head of vice and narcotics enforcement for the Vancouver police department, noticed indoor growers throwing out unwanted leaves and dirt at a site the city uses for refuse collection. He told the staff there to note the license plate numbers of every such farmer but called off his plan a few months later. “There were hundreds [of cars]. No way we could track them all.” At this point he supports legalization, if only so he can concentrate on Vancouver’s growing crack problem.

“If it wasn’t for pressure from the U.S., we’d just regulate this,” says Woods, who has all of six agents pursuing the pot trade. Investing millions more in a crackdown may be of little consequence, he adds. “You could give me a hundred people, and it wouldn’t make a difference.”